When hiring a personal loan you always do it with the idea that you can assume the fees agreed in the agreement, however, the different circumstances of life often prevent you from fulfilling your responsibilities.

In this case, what happens if you can not cope with one or more of the monthly payments on your bank loan?

1. The call of the bank

The first thing you should know is that as soon as you stop canceling one of the installments, the bank will contact you to inform you of the situation. Given this, we advise you not to try to hide the situation in which you find yourself and face it with all sincerity. No banking entity likes that its clients “disappear” after they have stopped paying.

Once you have contacted the bank, the responsible person or your account executive will explain the different economic sanctions that you will face.

2. Economic sanctions

Although the penalties will depend on the bank where you have contracted your loan and the specific conditions of the contract, you should know that these exist for all those people who have unpaid fees and represent the first way of solution by the entities.

Remember that depending on the amount of debt and the time you have not paid, the economic sanctions may be the following:

Delay interests

Default interest are those that the bank can apply from the first day of delay in the payment of a fee for a bank loan. These interests are fixed by Law and can not exceed the agreed interest rate by more than two points.

Claims Commissions

This commission is generated at the moment in which the bank must give notice to a client that has a pending or unpaid debt. In general, the commission of debtor positions usually ranges between 25 and 35 euros, however, each entity manages its own values. Remember that all these commissions will accumulate to the initial debt until the moment you get up to date on the payments.

3. The delinquent file

This point is very important, because you should know that from the second unpaid installment, the bank has the right to enroll you in a delinquency list. The most popular file in Spain is Asnef, but there are also others such as Rai or Experian.

And, although this measure is not an economic penalty, being part of a file of defaulters means that it will be almost impossible to access new financial products in the future. The only solution will be to get a lender who agrees to grant you a bank loan or directly apply for a loan with Asnef.

4. The judicial way

If the problem is more serious than you thought and you accumulate three or more unpaid fees, the financial institution can carry out legal proceedings against you to recover the money owed.

Generally, banks do not act alone and hire specialized collection companies. In case the trial continues its course you will have to pay all the accumulated debt plus the commissions for delay.

5. The embargo

In case you do not have the money that is requested, you will resort to the last stage of the process: the embargo. In this case, if your loan had a specific guarantee, it will be executed by seizing all those assets. However, in the case of a personal loan or if there is no particular guarantee, you will have to respond with your present and future assets (without the need to specify any in particular).

There are certain aspects that you must take care of so that you can obtain a yes when asking for a loan. For many or most financial institutions evaluate with greater importance the way in which you manage your finances and those of your business. All this in order that you can represent being a good client to obtain a loan or financing.

Next we will tell you what are those aspects to take care of and some tips so that you can keep them under control to obtain a yes:

Credit bureau

Belonging to a credit bureau does not always mean something bad, on the contrary you are there because you have requested different types of credits at some point. For example, bank cards, departmental or mortgages. What represents a bad aspect is that your credit score is inadequate. This is possible if you have not managed to properly manage your financings. That is, if you do not pay in time and form or if you have any outstanding debt.

What you can do is establish a plan to pay on time and another to liquidate those debts you still have. It is also important that you only have the amount of credits you really need, because many times when you have enough it is difficult to generate adequate control.

Financial health

Financial health is paramount so that you can get a yes when you ask for a loan, because it gives information about how you manage your business finances. And especially if you have enough financial skills that are needed to carry a proper handling for a loan.

In order to maintain good financial health, you must constantly monitor the performance of your business. Some aspects within this are the income and expenses, which can be improved if you identify what you are spending more on and can decrease them to have a higher percentage of income.

Payment capacity

The ability to pay can be identified as the amount of money you can spend to pay debts thanks to your income. Well, it’s not about ending up with the profits of your business, but because you have an adequate payment plan management you can have the liquidity to pay off these debts.

The best thing you can do to improve or increase your ability to pay is to reduce unnecessary expenses. You can also encourage your income through appropriate strategies that achieve it and above all avoid generating more or more debts. Limit yourself to what can really solve your business.

Now that you know the aspects that you must take care of to obtain a yes when asking for a loan, you can request it without any fear. Just implement those small tips to improve the perception that you will generate before the financial institutions that possibly grant you the credit that will make your business better.